How entrepreneurs can outdo competitors

April 22, 2012

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Competitors are around every corner. Young entrepreneurs often hesitate to follow their business dreams, because they believe their target market is already so competitive that there simply is no more room to absorb any startups.

However, small business owners still have chances to make it in a crowded field. The key to your business’ success doesn’t hinge on finding a completely empty field, but how you define your company and its place in the market.

Here are four easy ways to set entrepreneurs apart from competition.

1. You don’t have to reinvent anything out there

The market always needs innovators, but a business doesn’t necessarily have to be disruptive in order to succeed. Rather than struggling to come up with a brand new idea, take a look at your target industry and see where there’s a void to be filled. Then, figure out the best possible way to service that need and run with it. Starbucks is not the first or the last company to sell coffee. They just revolutionized the coffee shop by selling an experience along with a caffeine fix. Costa, Caribou and The Second Cup in Dubai do the same pretty very much successful.

Nowadays there may be too many coffee shops all over the city, but coffee houses are still finding a niche. Look at Shakespeare coffee shop in Dubai. It opened 10 branches in less than a decade. Local coffee shops can succeed by promising more than a cup of coffee and a place to sit. They are tapping into some of the most primal elements – community, networking and comfort.

Your product and service may be similar in many aspects to that of the competition, except for a few defining factors — and those are the key to everything. You should be good (or great) at all the basics, and then put your energy and focus on being exceptional at what makes you different.

2. Customer centered approach

Starting a business in an area or a city that is already populated with multiple competitors fighting for the same customers is very difficult. Entrepreneurs in Dubai have an advantage, because majority of the consumers in the retail sector are tourist.

Despite contending against huge chains with deep pockets and big advertising budgets, small boutiques can stil be hugely successful. How? By focusing on creating a one-of-a-kind culture at their premisses that defies people’s expectations of what a limited edition product can be. What can set many apart is the friendly, approachable personality of the entire staff.

No matter how big your business gets and how much staff you bring on, it always pays for business owners and top management to stay as close to their customers as possible. Talking to customers one-on-one is the best way to truly take the pulse of the market, customer needs and just how your company is doing.

3. Don’t compete prices

Eager to attract customers, many small businesses feel the only way they can compete in a crowded market is to undercut the competition on price. Dropping prices to manufacturing levels will surely trigger revenue growth, but you will most certainly lose money.

This happens to many small businesses in crowded markets. They find themselves running as fast as they can, yet they are still barely bringing in enough money to keep their operations afloat. Faced with this situation, what entrepreneurs ca do? They should reposition from competing on price to competing on service.

In a densely populated market, someone will always be willing to absorb a lower cost than you. You’ll need to find a new way to stand out! One way to do that is by offering personal service. Providing free business consultations and increased customer service can help maintaing prices and achieve growth. The key is defining who you are and what makes you different, and then focus on being as exceptional as possible in those differentiating areas.

4. Competition builds strength

A competitive and crowded industry indicates that customer demand exists, and that the market is viable. If you carve your own niche, there will be room for your business.

If you’re considering starting a business, don’t be disheartened if a lot of other entrepreneurs and companies are already offering a similar kind of product or service. You should still look before you leap and do your research on how you can stand out, but don’t let the idea of a saturated market stand in your way.